Request to Bankers for the Extension of Credit.

I Welcome the opportunity to send a message to the members of the American Bankers' Association, assembled for their fifty-ninth annual convention. I express my sincere appreciation of the cooperation of many bankers in what we have accomplished thus far toward national recovery. We are counting heavily on your assistance as we forge ahead.

I know that events of the past half year have brought to all of us a keen sense of the important part which a banking system plays in our lives. Six months ago the first of the great obstacles which faced this Administration was the lack of confidence in banks. The situation had become so serious that no other step could be taken until this difficulty had been met. There had been such a rush to turn bank deposits into currency or gold that even the soundest banks could not get enough currency to meet demands.

The banks of the country cooperated immediately with the measures which we found it necessary to take. The banking holiday and the Emergency Banking Act brought splendid results. Both bankers and depositors faced in good spirit the hardships which these measures entailed and by the end of March the major part of the banking facilities of the country were operating. Since that time steady progress has been made in liquidating banks which could not be recognized or reopened and in rebuilding those which had not been weakened beyond repair. At the same time, we have been accomplishing the objective we set for ourselves that losses of savings be kept at a minimum.

I do not mean to suggest that the task is finished. We have before us continuing duties for bankers, depositors and the Government in the development and maintenance of the highest standards in bank organization and management. The work of your association will be important in supplementing what is accomplished by government supervision. The need for your services is greater today than ever before.

We still have much to accomplish in making credit facilities adequate for the national recovery we are bringing about. The banks must play an important part in making increased loans to industry and commerce.

After a period of drastic liquidation such as we have experienced, it requires unusual courage and judgment to appraise security and to extend credit. The vital importance of helping the wheels of industry to turn by putting savings to gainful use must receive increasing and immediate attention.

Loans can and will be made. I want you to know that we rely on your organization for its cooperation in furthering the free flow of credit so essential to business enterprises, whether they be large or small. Only if this is done can employers do their full part in the great recovery program now under way.

Never before in its history has this Nation had greater need of courageous bankers. I am relying on them for prompt realization of the changes now taking place in general conditions and of their part in the revival of economic activities and the increased employment of workers. I am confident that you will work with me to meet the credit needs of industry and trade.